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Japan 19 March 1998 Tokyo District Court (Nippon Systemware Kabushikigaisha v. O.)
[Cite as: http://cisgw3.law.pace.edu/cases/980319j1.html]

Primary source(s) of information for case presentation: Matthew T. Davidson

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Case identification

DATE OF DECISION: 19980319 (19 March 1998)


TRIBUNAL: Tokyo Chiho Saibansho [District Court]

JUDGE(S): Toshifumi MINAMI


CASE NAME: Nippon Systemware Kabushikigaisha v. O.

CASE HISTORY: 2d instance Tokyo Koto Saibansho [High Court] (1998-ne-1954) 24 March 1999 [reversing: appellate ruling not relevant to CISG]

SELLER'S COUNTRY: United States (defendant)

BUYER'S COUNTRY: Japan (plaintiff)

GOODS INVOLVED: Automobile ("a classic Porsche")

Classification of issues present

APPLICATION OF CISG: No, court ruled it had no jurisdiction to hear the case. The CISG is referred to in an obiter dicta.


Key CISG provisions at issue: Articles 1(1)(b) ; 95 [Also cited: Articles 14(1) ; 31(a) ]

Classification of issues using UNCITRAL classification code numbers:

1A [Internationality: parties places of business in different States];

1B221 [Reservation under art. 95 to exclude art. 1(1)(b)]

Descriptors: Applicability ; Declaration, Art. 95

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Editorial remarks

EDITORS: Matthew T. Davidson & Daisuke Terasaki

In 1988, Japanese buyer (Nihon) engaged a California go-between who contracted on its behalf with defendant [seller] to purchase and prepare for export to Japan a "classic Porsche". [Seller] is a permanent resident of the U.S. living in California, but also a Japanese citizen registered as a resident of Japan.

In 1988 and 1989 [buyer] paid [seller] for the cost of the car plus modifications necessary for export. [Seller] failed to properly prepare the car and it was never sent to Japan. [Buyer] cancelled the purchase agreement and sued in Tokyo District Court for an indemnity equal to the amount paid, basing its claim on Japanese law. [Seller] objected that any lawsuit should be in California, and proposed California law and the CISG as governing law.

The Tokyo District Court decided that it had no jurisdiction to hear the case. In a ruling that is silent on the applicable law, the Tokyo Higher Court reversed the District Court.

The references to CISG Articles 14(1) and 31(a) occur in obiter dicta of the Tokyo District Court. Based on its evaluation, relying in part on these Articles, of where the offer was made and where delivery took place (both in California), accord Schlechtriem (1986), and in light of the "international" nature of the transaction, the court opined that Japanese conflict of law principles identified U.S. "federal" contract law as the law of the contract. That law, in turn, was identified as the CISG.

In a situation like this, where (1) the forum is a non-Contracting State, (2) the applicable law, as determined by the forum, is that of a Contracting State which has made an Article 95 declaration, and (3) the parties reside in (i) a Contracting State which has made an Article 95 declaration (U.S.) and (ii) a non-Contracting State (Japan), the consensus view is that the CISG should NOT be applied, at least by its own terms.* This certainly would have been the result had the case been heard before a U.S. (state or federal) court. Consistent, however, with its view that the Convention represented or constituted a "federal law of contracts," (an idea not without proponents in the U.S. legal community) the Tokyo District Court did not refer to Article 1(1)(b) as the source of application of the CISG to parties from different States only one of which is a Contracting State, nor did the court discuss the ramifications of the U.S. Article 95 reservation to Article 1(1)(b). (Of course, because the California defendant did not raise the issue of Article 95, the court may have simply been unaware of its importance.)

* See Peter Winship, "The Scope of the Vienna Convention on International Sales Contracts", in: Nina M. Galston & Hans Smit eds., International Sales: The United Nations Convention on Contracts for the International Sale of Goods, Matthew Bender: New York (1984) at 1-53.

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Citations to case abstracts, texts, and commentaries


(a) UNCITRAL abstract: Unavailable

(b) Other abstracts



Original language (Japanese): Hanrei Taimuzu no. 997, page 286

Translation: Unavailable



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Pace Law School Institute of International Commercial Law - Last updated January 23, 2003
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